US-China Trade War 2.0
The escalating economic conflict between the world's two largest economies
United States
China
Latest Developments
US Tariffs
125% on Chinese goods effective April 9, 2025
US Delay
90-day postponement for other countries
China's Response
84% tariffs on US goods
US Strategy
Objectives
- Reshape global trade order
- Force China to make concessions as an example to others
Methods
"Carrot and Stick" Policy
Combining maximum pressure with negotiation invitations
Potential Escalation
Non-tariff measures may be introduced
China's Response
Determination
"We have sufficient policy tools in reserve"
Prepared for confrontation rather than concessions
Implemented Measures
Equivalent tariffs
Rare earth controls
WTO lawsuits
Untrustworthy lists
Potential Measures
Consequences & Risks
Economic Impact
United States
Recession risk from soaring prices
China
May lose largest export market, affecting 5% growth target
Global Impact
- Earthquake for world economy
- Global supply chain disruptions
- Financial market volatility
Worst-case Scenarios
- "Economic nuclear war"
- Collapse of world monetary order
- Credit crisis and mass bankruptcies
Impact Severity
Prospects
Mutual Dependence
US firms in China
Chinese listings in US
Both economies remain deeply interconnected despite tensions.
Current Phase
"Testing endurance" phase
Both sides assessing how much pain they can inflict and withstand
Opportunities for negotiation and tension reduction still exist.
Key Insight
This trade war represents a fundamental shift in global economic relations, not just a temporary dispute. The outcome will shape the 21st century economic order.
